economics essay

Does current slowdown suggest benefits of globalisation have been exhausted

Published: 23, March 2015

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Globalisation is expanding at a brisk pace with different development activities around the world. I am assessing with the help of globalisation the global world is going to slowdown or the benefited. And does this slow down suggest that the benefit of globalisation have been being exhausted? I try to write either negative I mean slowdown or benefited sides of globalisation impact in the world. And I also emphasis on the different scholar ideas to improve the situation by discussing. Some people have argued that the globalization is not blame for increasing poverty and inequality. The current distribution of economics and politics power in the world is equal. The globalisation provides for equal opportunities for poor and rich, global affairs, relatively powerless and as a result the poverty is declining in the world. Although poverty is remains in those countries like Africa and south Asia and among rural areas people china, India, (on $1 a day or less) and Latin America. Due to globalisation day to day the barriers are reducing in those sectors with the help of developed country's foreign investors. Many Garments factory, technological, pharmaceutical industry's research and development now set up in poor developing countries by FDI and those countries like China, India, and Bangladesh as well. The business of China dominating by their product at a cheapest price in the world market. Another example India is also developing in software industries with the help of technology and skill worker at a low cost. In the mean while we have seen not only slowdown in the world due to globalisation also getting benefit developing countries due to utilise global ideas properly.

Objectives:-

There are several factors which make barriers or slowdown for development and my aim is to assessment the slowdown and critically evaluated the matter through different information and objective is to improve the situation with the help of scholar view or theory and make my own decision to tackle this crisis. I would prefer to start for knowing the reasons or lacking that creates slowdown and how we can get the benefit of globalisation at this stage. We know the developing countries have already exists different slowdown position such as poor infrastructure problem, education, technology, transport system, communication, political factors such as communism and socialism, diseases (HIV, Malaria), corruption, and terrorism as well. On the other hand we have seen that the global trade in manufactures; technological, pharmaceutical sectors are increasing now days. In My view due to globalisation the world is getting benefit through the development and on the other side the world has been suffering and facing threat along with slowdown the concept or benefit of globalisation is being exhausted by others group and I am trying to develop the situation.

Literature review

Different example of Slowdown & reasons:-

According to Economist Bhagwati (2004) "Globalisation" means many things. He defined as "Economic globalization which is constitutes integration of national economies into the international economy in through trade, foreign direct investment (by corporation and multinationals) short term capital flows, international flows of worker and humanity generally with the help of technology". He also defined the cultural globalization and communication. The globalisation is the extension of capitalism.

In terms of this the current situation the oil price or share price of different companies in the market is always instable position in the free economy time. Think now for the price of oil is always up and down and the customers are facing different problems. The decision maker can not take the exact decision on oil prices due to depend on uncertainty production of oil in the market. Another issue that when the oil price increases then all the bad impact comes on commodity price and sometimes market are suffering inflation. But the fact is the Middle East countries are enjoying the benefit without increasing price and they frightened to supply more according to the demand in the world market according to McManus (2008). This are the back dated people in those countries are making critically problem during globalization and we have to producing alternatives energy sources for meeting the demand of customer and I have found how the middle east society exploited during the globalisation and the benefit is being exhausted.

Now a days the recent problems like credit crunch spread in the world. The banks are probably very difficulty getting funds and the public are failing to gain loan or fail to payment their credit bill or mortgage in the world. This is a big problem and shock in the global financial market. In terms of this slowdown of global problem the financial market has been suffering liquidity crisis due to have proper keeping customer credit history record system during this competitive global market. And the large USA and UK stock market are suffering recession and inflation which is not expecting during globalisation. And the US citizens are loosing their home and become frustration along with lost their wealth. Although The UK government has able to tackle this crisis now and 11% price down but still the inflation double than before and the benefit of globalisation is being not treated very well due to numerous current slowdown activities and .

Hirst and Grahame (2000) mentioned that most growing economies in south East Asia and South Korea had suffered major economic crisis in their currency and equity market and major contractions in employment. The crisis is due to the sudden withdrawal of short-term funds by western investor and large scale short selling on foreign exchange and equity markets by speculators. Another similar example of Asian crisis that began 1990's, financial meltdown in Russia in August1998 and severe turbulence in Latin American market particularly Brazil, Argentina due to globalisation in the world market. And those countries are still not economically strength and suffering for huge financially deficit now and for this current slowdown suggest all benefits of globalisation have been exhausted.

The problem with globalization is not only with third world countries but also in developed countries like terrorism. Today the world in very danger with that. The Financial times, London (2006) published that the globalization was doomed in the aftermath of the outrage of September 11, 2001 in USA. The terrorist killed many people and destroyed the world trade canter. They also attack in Thailand holiday resort in Bali. The onward march of global economic has faced financial crisis, the stock market collapse in the world due to this accident. So globalization has another bad impact of using nuclear power. The nuclear power is increasing the world and become warning in the world. Earlier this year investigator determined that Pakistani scientist A.Q Khan sold the technologies to build nuclear bomb in different countries such as Iran, Libya and North Korea. It is good news now UN, IAEA concludes for not practice and using in those ammunitions in those countries. Although Iran does keep the commitment and enriched the uranium itself and failing the world in great problem. These situations occur due to free movement of trade in the global market and take the advantage. This entire thing is account for globalisation only. (IEEE Spectrum. New York: June 2004).

Kaplinsky (2006) stated that there were 864 million people under poverty in the world due to globalisation. Although most poverty remains in those countries like Africa and south Asia and among rural areas people of china, and India due to globalisation. They were living on less than $1 per day where develop country's people minimum wages is $7 per hour and enjoy very comfortable life. Stiglitz (2005) identify that due to Have political issue and lack of skill worker , degraded environment, and destroyed original culture and the pressure from IMF, USA, WTO developing countries are not economically going up, and rising poverty year to year . These slowdowns suggest that those incidents bring the slowdown of globalisation and deprived from all benefit of globalisation

Bhagwati (2004) address that the child labour is increasing in the world. You can find child labour also in USA which is rich country in the world. They sell flower, cold drinks, and magazine on the street. They live in the dirty places which no hygienic at all. The international labour organisation and international agency charged the world labour issue and according to their report that 100 to 200 million children are under fifteen are at work and 95% are from poor countries and half of them are from Asian countries. About 100 million children have often gone to primary school in those countries. The children sometimes smuggled in different countries in the world. This problem is longstanding and historically inherited, extremely improbable as well in the world due to globalisation.

Stigltz (2006) stated that the world people are suffering from different diseases and not able to afford the cost of expensive drug in the market. The globalisation is account for this situation. We identify that how much dollar income per person where a person can afford buying the drug. There are many people now suffering AIDS diseases. The fatal disease is more in these countries such as Africa, South Asian courtiers such as Thailand and India. He also accused for using green house gas for pollution. Its all about ethical environment issues and that ignoring in the world and fell into slowdown.

Different Ways of Overcome the slowdown:-

The critical aspects of globalisation and use different theories like John Dunning OLI, Michael Porter Diamond theory, Heckscher Ohlin model, global shift theory, different core ideas in dissertation that the world can more globalise and be benefited with the help of globalisation .

Dunning OLI theory:-

Dunning theory's first factors is ownership factor the foreign direct investor not only depends on cost but also emphasis on ownership factors such as skill workers, network, and ease of access to capital and use of technology protected. Japan joint venture with Rover and they are producing Honda car in the UK as an example. They believe and invested in the UK for having skill worker, high technology and can produce good quality product with best performance. So globalization makes it possible. The Japanese Company can say it is a UK car. Market size and growth potential are the most important factors according to Meyer (1998) and Floyd (2002).China, India, and Russia are the good location and those countries have low cost bases now. The market of china has grown GDP10% now. Indian software industry becomes more important in the world. The location is more attractive to USA and UK firms which show prominence in this software industry (Heek, 1999). The global software industry is estimated worth around $1,300 billions now. India's software export was worth $12 billions in 2003 and growing 26% over the fiscal year which is a good for a developing country. They export USA and dominating market, US buys $6 billion software products (McManus, 2004). India only 3% export software products now in the world. Dunning internalisation is another major factor that can help all the global trade Mc Mananus and Floyd (2004) both stated that today India has benefited from having technological innovation. They improve the research centre and Google the world's largest search engine is all set to open a development centre in Bangalore in India. Another leading web company yahoo carries out development work in Bangalore. Intel recently announced its plan to invest a $41 million 42 acre site in Bangalore next year.

Heckscher -ohline Theory:-

Heckscher -ohline theory is also very helpful for being a country benefited. With the help of globalisation it is possible to remove the poverty and improve the global world. The concept of this theory is that the country has more capital but not enough labour. In that's way the country can invest his money any poor country or developing country where both of them beneficial and progressing for global market. Sweden, Netherlands or Finland those countries whose have relatively capital rather than labour. They can invest any sub- sharan Africa or developing country such as china or India. These countries have large labour forces or they can produce large labour intensive goods (Opcit).

Global Shift Theory:-

'Today's global economy is genuinely borderless. Information, capital and innovation flow all over the world at top speed, enabled by technology and fuelled by consumers' desires for access to the best and least expensive products' (Ohmae, 1995). Dickens (1992) suggest in his global shift theory that the world become more internationalised and more globalise due to capital which organised by multinational companies. The theory includes three important factors such as high Technology for quality production, the relation between government and foreign organisation where any large organization can do international business in overseas with the help of politics and economics.

Methodology

In the business research, quantitative or qualitative methods can be used. My research will be multi- method approach combining qualitative and quantitative. It is quite usual for a single study to combine quantitative and qualitative methods and to use primary and secondary data. There are some advantages to employing multi-method in the same study. Each method, tool and technique has its unique strengths and weaknesses. By combining quantitative and qualitative methods, I can employ the strengths of the both methods. There are an inevitable relationship between the data collection method someone employs and the result someone obtains. Qualitative data collection method is different from the quantitative method. By using the combination of quantitative and qualitative, I will be able to employ different data methods according to my research requirement. Quantitative and qualitative research methods are most often associated with deductive and inductive approach.

Quantitative and qualitative methods:

Ritchie and Lewis (2005) qualitative research consists of a set interpretive and material practice. By the term "qualitative research" we mean any types of research that produces findings not arrived at statistical procedures or other means of qualification. It can refer to research about person's lives, lived experiences, behaviours, emotions and feeling as well as organizational functioning. Some of the data is quantified as with census or background information about the persons or subject studied, but the bulk of the analysis is interpretative. Bryman and Bell (2003) suggest that quantitative research deals with numbers uses statistical models to explain the data. In very board terms, it was described as entailing the collection of numerical data and exhibiting a view of the relationship between theory and research as deductive, a predilection for a natural science approach and having an objectivist conception of social reality. According to Ghauri and Gronhaug (2005) it is often the case that there is a needed to examine both the number and nature of the same phenomenon. Qualitative research might be used to provide a profile of expenditure in different areas over a number of years or to compare the characteristics of the high expending areas with lower spending areas. Qualitative research might be explored the processes through which expenditure is controlled or the factor that have led to change in pattern of overspend. I like to combine quantitative and qualitative method in my dissertation. There are some advantages to use quantitative and qualitative in the same study. For example, qualitative interview is usually very different from interviewing in quantitative. In the quantitative method, interviews are structure. On the other hand, the interview of qualitative method is unstructured and semi structure. For the different people presentation, I may use unstructured interview. In different tutor and researcher level, I may use structure interview because they not be interested in depth interview.

Inductive and deductive approaches:

According to Ghauri and Gronhaug (2005), inductive is based on empirical evidence. Induction processes draw general conclusion from our empirical observations. In this type of research, the process goes observation findings theory building. Inductive research is often associated with the qualitative types of research. Inductive approach enable some one to take a more informed decision about research design which is more than simple the methods by which data are collected. It is the overall configuration of a piece of research: what kind of evident is gathered and from where and how much evidence is interpreted in order to provide good answers to the basic research question. Deductive represents the commonest view of the nature of relationship between theory and research. Deductive process goes from theory observations findings. Deductive approach can be quicker to complete. The deductive approach can be low risk strategy. Most managers are familiar with the deductive approach and much more likely to put faith in the conclusion emanating from this approach. I will use deductive approach and inductive approach in my dissertation. The both approaches have positive sides; I like to use both negative and positive side of the two approaches to make a good dissertation.

Plan of Work:-

Research Design

There are some research strategies for primarily collection data that I may employ in my research. These strategies are:

Experiment-

Survey- Surveys require asking people who are called respondents. Questionnaires and interviews are utilized to collect data on the telephone, face to face and through computer media.

Case study-I will use case study analysis in my dissertation because case study can be very worthwhile way of exploring existing theory. In addition, a simple well constructed case study can enable me to challenge an existing theory and also provide a source of new hypotheses

Grounded theory-

Action research-

I will use survey and case study research technique in my dissertation.

Primary data:

According to Ghauri and Gronhaug (2005) when we collect data by ourselves and that are relevant to our particular study or research problem. These data are primary data. The main advantage of primary data is that they are collected for the particular project at hand. This means that they are more consistent with our research questions and objectives. Primary data can be collected by interview, questionnaires and observation I shall collect the primary data by interview, questionnaire, along with I may work or survey in different companies for my answer if possible. The questionnaire will consist of both unstructured and structured question. Unstructured question will only be used as a possibility for the participants to add any additional comments to the structured question before and structured question, mainly of dichotomous nature, will be based on ordinal, interval and ratio scaling. Ordinal scaling is used to find out whether a certain objective has more or less of a characteristic then another object. Interval question scaling allows the researcher to compare also the differences between objects on the other hand ratio scaling which contains all the information of nominal, interval and ordinal scales.

Secondary data:

Secondary data means that already exist as they were collected in the past for other purposes and by someone other than the researcher and the advantage of secondary data are low cost , rapid collection that the data is readily available and often from a unique source. According to Zikmund (2003) most organizations collect and store a variety of data to support their operation. Secondary data are indispensable for most organizational research. Secondary data refer to information gathered by someone other than the researcher conducting the current study the literature which has been used for secondary research can be differentiated between books and journals focusing solely on the theoretical structure and approaches of specific portfolio concepts. I shall also collect secondary data through different currents articles and news, magazine, and videos, IMF report, World investment report, United nation trade report, financial times, Business weak and Journals and different current incidents from different sources. Secondary data include both quantitative and qualitative data and can be used in both descriptive and explanatory research.

Research ethics:

According to Saunders et al (2000) in the context of research, ethics refers to the appropriateness of your behaviour in relation to the rights of those who become the subject of your work or are affected by it. According to Zikmund (2003) Ethics is a code of behaviour appropriate to academics and the conduct of research. The Ethical issues are divided into four subsections. In the first stage, we outline the range of Ethical issues that affect research process across its various stages. In the second stage, we discuss Ethical issues which arise in particular during the design stage and when seeking initial access. In the third stage, we discuss ethical issues that are prominent during the data collection stage. In the fourth stage, we discuss Ethical issues related to the analysis and reporting stages. I will maintain research Ethics during dissertation.

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